🔶 Base Metal Fundamental Update

📅 Date: June 27, 2025

Copper:

Media reports suggest that Trump may announce Fed Chair Powell’s successor as early as September, raising concerns over the Fed’s future independence. This has weakened the US dollar index to its lowest since early 2022, supporting copper prices. Meanwhile, the White House stated it has no plans to extend the tariff suspension beyond July 9. On the supply side, smelters are increasing exports while spot availability tightens due to semi-annual settlement. Overall, copper prices are expected to remain firm with strong support.

Aluminum (ADC12):

Import prices remain stable at $2,430–2,470/mt, while domestic spot prices hover around 19,200 yuan/mt with ongoing losses of 700–800 yuan/mt. Inventory has risen to 20,587 mt, reflecting continued off-season weakness and rising competition. While cost support remains, prices are expected to stay rangebound in the short term. Watch for changes in raw material flows and demand signals.

Lead:

SHFE lead prices reached a three-month high this week. Maintenance activities at primary smelters and gradual recovery in secondary lead production are shaping supply. On the demand side, small and mid-sized buyers are more active, despite some large downstream players delaying procurement due to mid-year inventory checks. Going forward, monitor secondary smelter output and changes in inventory trends.

Zinc:

Zinc rose sharply overnight as expectations of aggressive US rate cuts weighed on the dollar. A strike at Nexa’s Cajamarquilla smelter in Peru (capacity: 344,000 mt) and low LME inventories are boosting prices. Domestically, SHFE zinc is tracking LME gains, supported by low social inventory despite inventory fluctuation expectations. Zinc prices are likely to stay elevated in the short term.